Forum - View topicNEWS: Navarre Withdraws Stock Offering to Finance Funimation Purchase
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Joe Mello
 Posts: 2312 Location: Online Terminal |
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Okay. Somebody needs to explain this to me, too. I don't even know if this is good, bad, or indifferent. All I know is that I turn 20 on the deadline. ^^;
Dammit, Jim, I'm a Math major, not a Business major! |
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Tempest
 I Run this place.ANN Publisher  Posts: 10461 Location: Do not message me for support. |
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It's neither really.
It doesn't signal any change in the deal between Funimation and Navarre, just how Navarre plans to raise the $100 million that they're giving to FUNimation. Originally they were going to issue $100m worth of new stock, people would buy that stock (becoming Navarre shareholders), Navarre would get $100m and give it to FUNi's owners. Now they're going to do something else to raise the $100m. Issuing new stock can be risky, but when its for a buyout, it's a legitimate move because the company's value is increasing by the same ammount they raise (because Navarre's total value will increase by the addition of FUNimation). -t |
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Mohawk52
 Posts: 8202 Location: England, UK |
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Yes but that theory can work backwards for Navarre. Market analysis's might see it as Navarre stretching themselves too far and that will cause their stock price to fall on negative speculation. This will reduce the value of those stocks below what was agreed they would have been worth. If Navarre can not find the $100 Million the deal will fall through.
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